Mon June 18, 2012
A&M System Lands Major Federal Biosecurity Contract
A Texas A&M University System-led team has won a major federal contract to develop one of three new national centers — the only one led by a public university system — for developing and manufacturing medicine and vaccines to respond to pandemic diseases and bioterror threats.
U.S. Health and Human Services Secretary Kathleen Sebelius announced the contract on Monday. The other contracts were awarded to Emergent BioSolutions in Baltimore and Novartis in North Carolina.
After the H1N1 flu pandemic of 2009, federal officials realized the need to significantly improve the speed of its response to pandemics. These three centers are expected to be the lead responders in the event of a major national biological outbreak, whatever the cause. The center in College Station is expected to first come online in December 2015.
A gathering of about 300 people watched a live feed of the announcement in the Stephen F. Austin Hotel in Austin, along with A&M System Chancellor John Sharp, who called it a “once-in-a-generation” announcement. He said the project is expected to create about 1,000 jobs, primarily in the Brazos Valley.
Some are comparing the announcement to the day Houston learned that NASA was coming to town, and it could definitely be a turning point for the region and the state, moving it to the center of the action in the pharmaceutical industry. The $285.6 million contract includes an initial investment of $176.6 million from the federal government. More than 20 commercial and academic partners that make up the team will share the remainder of the cost, as will the state of Texas, which has committed $40 million to the effort.
“I think it is likely to change all of Texas,” said Dr. Brett Giroir, the A&M System’s vice chancellor for strategic initiatives and the principal investigator for the new center. “We really feel, in the next 25 years, this could develop into the equivalent of a Los Alamos.”
Only the first five-and-a-half years are guaranteed in the 25-year contract. Should the federal government continue for the remaining 20 years, that portion of the contract is valued at more than $430 million. And that does not include what could ultimately be billions in business conducted by the center once it is up and running.
“This is something that could not have happened without Barack Obama and Rick Perry,” Sharp told the Tribune. In addition to the president and Texas governor, Sharp also added that Lt. Gov. David Dewhurst and House Speaker Joe Straus played key supporting roles.
But it took more than just their support. Giroir described the years of work that went into securing the contract as “more challenging than anything I could have imagined.”
Giroir had been laying the groundwork for a major biotech corridor in Bryan-College Station since he joined the A&M System in 2008. It became clear that the national mood was growing ripe for such a development when, in his 2010 State of the Union address, Obama spoke about the need to “respond faster and more effectively to bioterrorism or an infectious disease."
In August that year, HHS issued a report calling for “the nimble, flexible capacity” to produce medical countermeasures like vaccines “in the face of any attack or threat, known or unknown.” Giroir’s team has been preparing ever since — he said they haven’t had vacation since September 2010.
HHS put out its initial request for proposals for the Centers for Innovation in Advanced Development and Manufacturing in March 2011. They are expected to be able to respond rapidly (about twice as fast as the nation’s current capability) to new biological threats, such as pandemic influenza. They are also expected to boost the nation’s current vaccine stockpiles as well as develop the pharmaceutical workforce.
The A&M System assembled its team of more than 20 partners, which includes private companies like Belgium-based GlaxoSmithKline and public entities like the University of Texas Medical Branch at Galveston and submitted a nearly 3,000-word proposal in May 2011.
The team gave oral presentations Aug. 10 in Washington and learned advanced to the next stage in November, when it had to submit nearly 900 more pages of responses to questions. Federal officials conducted a site visit in December followed by a complete audit of the team’s finances.
Negotiations began in February. At least twice in April, it appeared negotiations were closed, but were unexpectedly reopened.
“To a great extent, this is not a typical negotiation,” said Giroir. “It’s more that the government is letting you know what they want and what they expect, and that’s it.”
As the process concluded, the biggest risk factor that emerged in the bid was whether the A&M System could persuade the state to invest $40 million in the project. The efforts were successful.
A&M System officials said the project is expected to receive about $15 million from the Texas Emerging Technology Fund, a discretionary fund run out of the governor’s office. The governor, lieutenant governor and speaker have also signed a commitment to find another $25 million from other sources.
Perhaps ironically, Monday’s announcement represents a sort of reversal of fortunes for one of the Emerging Technology Fund’s largest and most scrutinized payouts, which also benefited the A&M System. In 2005, it put $50 million into a new Texas Institute for Genomic Medicine, at the time a public-private partnership between the A&M System and a private company then known as Lexicon Genetics. Because of some of the company’s investors’ ties to Perry, the move prompted accusations of cronyism. It also failed to secure major grants that it had been banking on.
Ultimately, the partnership was dissolved and — to the chagrin of some skeptical faculty members — the center moved fully under the A&M System.
While TIGM won’t be as active in the new center like other assets will be at the A&M System, Giroir said it provided the cornerstone around which a consortium of other key research centers have grown. Some of those have also been criticized. In 2009, when another $50 million was doled out from the fund to launch the A&M System’s National Center for Therapeutics Manufacturing, concerns were raised once again. Lawmakers questioned why it did not travel through the standard approval process.
But it was approved and will play a key role in the new federal biosecurity center. The NCTM includes a 104,000-square-foot bioprocessing wing with space for up to 20 special disposable research pods that can be switched out quickly for new projects. This capability, along with a major operation devoted to plant-based vaccine production (as opposed to the traditional, time-consuming egg-based process), are key factors that allow the A&M System to be particularly flexible in its research and production.
“We have the perfect mix and the right people for this,” Sharp said, noting that the system's unique — and relatively new — infrastructure for pharmaceutical research was key to landing the contract.
Giroir, who also credited Sharp for putting the project at the top of the priority list when he became chancellor in September 2011, said he remained nervous about the endeavor until they received the signed contract Friday from the federal government.
Giroir said that he anticipated an economic impact report outlining the effects of the new award in approximately three months as the final details of the arrangements with the subcontractors on the team are ironed out.
In the meantime, this summer, A&M is promoting biopharmaceutical education in College Station. This month, it is piloting a summer camp for ninth- and 10th-graders at the NCTM. The federal government declined to fund it, but Giroir said the A&M System was moving forward with the camp because it was important to start training the workforce early.
“We want to get them excited,” he said. “If they want to save the world, this is a way they can actually do it.”
The contract does put money toward workforce training in post-secondary education.
“I think it’s big for Texas higher education and our case for doing high-level research,” House Higher Education Chairman Dan Branch, R-Dallas, said on Monday. “I think this sort of enhances our story that tier one-level research is not only good for our students and our faculty but also for the Texas economy and for the nation.”
In addition to meeting the new center’s stated goals, Giroir said he’d like to also use the soon-to-be added pharmaceutical capacity to take on ailments like malaria, AIDS, cancer, and tuberculosis and “wipe out one or two of these major killer diseases from the world.”